Expenses related to Empire's acquisition of Safeway's Canadian assets also weighed on the company's profit.

Empire bought the assets for $5.7 billion last year to double its reach in the country's western provinces.

Empire, which faces competition from bigger rival Loblaw Companies Ltd (L-T) and U.S. retailers such as Wal-Mart Stores Inc and Target Corp, said its earnings were negatively affected by a highly promotional environment.

The company cemented its position as Canada's No. 2 grocer with the acquisition of Safeway Canada, which contributed $1.62 billion to Empire's total sales in the third quarter.

Empire's total sales rose more than 40 percent to $6.02 billion, helped by higher sales from its food retailing business.

Sales at established Sobeys stores, an important measure for retailers, fell 0.2 percent from the year-earlier quarter.

Loblaw, which reported a better-than-expected quarterly profit on February 20, warned of an extremely competitive first half.